What Is The Law Of Diminishing Marginal Product?
Law of diminishing marginal product or productivity is an economic theory. It proclaims that while rising 1 input and maintaining other inputs at the constant degree might initially rise the output, further rises in that the input will have a restricted effect and will ultimately have nil consequence or a pessimistic effect on the output. The law of diminishing marginal productivity helps elucidate why rising manufacturing isn’t always the principal way to rise profitability.
What Is The Law Of Variable Proportions?
The law of variable proportions proclaims that as the quantity of 1 factor is grown, keeping the other factors constant, the marginal product of that factor will eventually come down. Law of Variable Proportions occupies a significant position in the economic theory. This is also known as Law of Proportionality.
Keeping other factors constant, the law elucidates the production function with 1 factor variable. In the short run when output of a good is pursued to be grown (increased), the law of variable proportions comes into operation.
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